OK. Maybe I've watched the box set of Heroes Season One too many times recently, but once again people in Congress are trying to kill the penny again. 60 Minutes ran some great reports on this topic recently.
Given the run up in the cost of all commodities, especially Copper and Zinc, it should be no shock that the cost to make a Penny AND a Nickel are higher than the face value on the coins. No one is talking about offing Jefferson ...yet, but old Abe is in the cross-hairs again.
In 1982 they changed the Penny from 95% Copper and 5% Zinc to 97.5% Zinc and 2.5% Copper. But now the price of Zinc and Copper are such that the penny costs 2 cents to make. So what to do?
I frankly can't see the US Congress cutting the penny. The short term savings of $130 Million to stop all production of pennies, doesn't outweigh the inflation estimates of $600 Million from the American for common sense. Advocates that say, "prices will round down too and balance this out", sure have forgotten what happened to all of those countries that changed over to the Euro.
The next morning in Germany, instead of just seeing the equivalent price in Euro's from their old Deutche Marks, they found prices rolled up to the nearest Euro- .99 mark. An average inflation of 4.5%...overnight! This alone has been the rally call for other European counties to avoid the currency!
The US economy is scared with 3.1% inflation over a year...imagine 4.5% overnight!
I don't think this has real legs to get passed, but instead of charging the mints with monitoring and adjusting metallurgy as needed, some in Congress take a knee-jerk reaction that could cost us hundreds of Millions!
Abe, save us...you are our only hope!